Missouri senators debate nuclear plant bill

Wednesday, April 8, 2009 | 11:34 a.m. CDT

BY
CHRIS BLANK/The Associated Press

JEFFERSON CITY — Missouri senators argued at length Tuesday over legislation triggered by AmerenUE's efforts to build a second nuclear reactor at its Callaway power plant, proposing dozens of changes to the bill.

After more than 10 hours of debate, the Senate went home early Wednesday without voting on the measure. Senate Pro Tem Charlie Shields, R-St. Joseph, said AmerenUE, industrial energy users and the state official who represents utility customers were invited to a negotiating session in his office later Wednesday.

The contentious proposal would let utilities pass the financing costs of new renewable-energy and reduced-emission power plants on to customers while they are being built, rather than waiting until the plants start producing energy, as required by a 1976 state law approved by voters.

Sponsoring Sen. Delbert Scott, R-Lowry City, said the changes ultimately would save money for consumers. He said Missouri must adjust how it produces electricity, particularly in anticipation of federal legislation to cap carbon dioxide emissions.

But critics argued that it's unfair to force electric customers to pay for plants that aren't producing and might not ever be built. They also said the legislation doesn't give state utility regulators enough authority.

In the bill's first airing on the floor of a legislative chamber, senators began by discussing whom to exempt from any electric rate increases caused by the legislation.

First, senior citizens and the disabled who earn $40,000 or less were spared. Then, senators tried unsuccessfully to exempt automobile manufacturing plants and New Madrid-based smelter Noranda Aluminum Inc., which last week contributed nearly $80,000 to a political action committee opposing the legislation.

"As many people as we can get out of the bill, the better," said Callahan, D-Independence.

On a 22-9 vote, the Senate also defeated an amendment that would have required voter approval before the changes could take effect.

St. Louis-based AmerenUE has filed an application with the Nuclear Regulatory Commission to build a second reactor at its Callaway nuclear plant, about 25 miles northeast of the state Capitol.

AmerenUE has not decided whether to build the second reactor, but company officials have said they doubt the company can amass sufficient private capital without repealing the 1976 law.

Under the bill, utilities would be allowed to seek approval from state regulators to charge electric customers for the financing costs of building new power plants.

Here is how that would work:

A utility would file an application with the Public Service Commission to charge electric customers for pre-construction costs. State regulators would then have one year to determine if those costs were prudently incurred.

The company then would need to get the required licenses and permits for the proposed power plant.

After that, the utility could ask regulators to issue an order allowing electric customers to be charged for the capital costs of building the new power plant. The Public Service Commission would have 11 months to rule on those requests.

The company could then seek additional rate increases quarterly, unless state regulators specifically outline a different time frame.

The legislation also lets utilities collect costs from customers if they decide to abandon a project. But if a company sells a license to operate the power plant, then customers would get all the proceeds, plus interest, thanks to an amendment offered by the bill's critics.

State utility regulators also would need to give lawmakers and the governor's office a report by August 28, 2010, about the benefits and problems with using several different methods to pay for new power plants.

The debate over how to pay for new power plant construction had been considered one of the top issues for this legislative session. But until a Senate debate that frequently turned hostile, the discussion mainly had been waged by activists and via advertisements.

Many of the legislation's provisions were written by freshman Sen. Kurt Schaefer, R-Columbia, who said the bill is vital to develop alternative energy sources in the state. He said lawmakers must consider what needs to be done to create the infrastructure that will be used for producing electricity 20 and 30 years from now.

"What are we willing to accept, what are we willing to change?" Schaefer said in a rhetorical question posed to fellow senators.

Schaefer defended his legislation, at times angrily, and told one critic: "Don't sit here and sanctimoniously lie about what's in this bill without reading it." The remark prompted a rebuke from another senator, and Schaefer later apologized.

Despite bill supporters' arguments, several senators remained unconvinced. Sen. Rob Mayer, R-Dexter, filed more than a dozen amendments, and Sen. Jason Crowell said most supporters don't face any rate increases under the bill.

"When you rob Peter to pay Paul, you can always count on Paul's support," said Crowell, R-Cape Girardeau.